You Have Been Given the Following Data: Specification Information: Anything

question 24

Multiple Choice

You have been given the following data: Specification information: Anything between 10 and 20 units per order is acceptable.
Process Mean: 13
Upper limit of the process: 16
Lower limit of the process: 10
Using this information, which of the following conclusions is most appropriate?

• A) The process is not capable since it is not centered.
• B) The process is barely capable but not centered.
• C) The process is capable and centered.
• D) The process is not capable and centered.

---

Definitions:

Top Management

The highest level of managers within an organization, responsible for setting policies and making critical decisions.

Materiality

A company-specific aspect of relevance. An item is material when its size makes it likely to influence the decision of an investor or creditor.

Activity Level

An indicator of the volume of business activity or operations in a specific period, often used in costing and budgeting to measure performance.

Fixed Costs

Costs that remain constant in total regardless of changes in the level of activity within a relevant range.